How to file your sales taxes in Minnesota

Once your business has a Minnesota sales tax license and begins to make sales, you are required to start collecting sales taxes on behalf of the Minnesota government and filing regular sales tax returns. This page will help you understand the basics of your tax collection and filing responsibilities.

How To Collect Sales Tax In Minnesota

If the seller has an in-state location in the state of Minnesota, they are legally required to collect sales tax at the tax rate of the buyer's location, as Minnesota is a destination-based sales tax state.

If the seller's location is out of state, then the same policy applies: the state of Michigan still requires the seller to charge the sales tax rate of the buyer's location.

Sales Tax Collection Discounts In Minnesota

While many states allow merchants to keep a small percentage of the sales tax they collect as a collection discount, or compensation for the work put in collecting the tax on behalf of the state, Minnesota does not currently allow this.

Your Minnesota Sales Tax Filing Requirements

To file sales tax in Minnesota, you must begin by reporting gross sales for the reporting period, and calculate the total amount of sales tax due from this period.

In the state of Minnesota, all taxpayers have three choices, for filing their taxes. One option is to file online by using the Minnesota Department of Revenue. This online system can also be utilized to remit the payment. It must be noted that if your business has a sales and tax liability of greater than ten thousand dollars within the state's fiscal year, all taxes must be paid electronically(this begins with the following calendar year). The online system Autofile can also be utilized to both file and pay your business's taxes online. The final option is filing over the phone. This is done by touch tone phone.

Tax payers in Minnesota should be aware of late penalties the state applies. The penalty for late paying is 5% for up to thirty days late, 10% for up to sixty days late, and 15% if the payment is more than 60 days late. An additional 5% is added to any owed percentage if the return is filed late.

The state of Minnesota requires that a seller who owns a sales tax permit files sales tax return on the required day, so long as the tax return would have been "zeroed-out", and there is nothing to report.

Taxpayers whose sales and use tax liability exceeds ten thousand dollars during the prior year (fiscal year, which should end on June 30) must make all of the payments for periods in the following calendar years by EFT, unless they are specifically prohibited by their religious beliefs.

You can process your required sales tax filings and payments online using the official Minnesota e-Services System website, which can be found here . You should have received credentials to access your Minnesota e-Services System account when you applied for your Minnesota sales tax license.

SalesTaxHandbook Instant Feedback

We value your feedback! Do you have a comment or correction concerning this page? Let us know in a single click. We read every comment!

Get help handling your business' sales taxes.

Automate your business's sales taxes! Our partner TaxJar can manage your sales tax calculations, returns and filing for you so you don't need to worry about mistakes or deadlines.

If you're an online business, you can connect TaxJar directly to your shopping cart, and instantly calculate sales taxes in every state. SalesTaxHandbook visitors qualify for a free month by signing up via our partner program here: